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Canada’s hiring forecast shows the weakest outlook since 2009

In its latest Winter Business Outlook Survey conducted by the Bank of Canada, the adverse effects of the oil crash continue to spread beyond the resource sector to other regions and industries.

The Bank’s quarterly report surveys around 100 businesses for their outlook on a range of economic issues. Business leaders’ investment and hiring forecasts have dropped to their lowest levels since 2009, when the effects of the 2008 global financial crisis were working their way through the global economy. Firms cite their concerns about the strength of domestic demand, uncertainty about the regulatory and tax environment, insufficient foreign demand and low commodity prices.

The steep fall of oil prices has depressed the outlook in Alberta and beyond. Firms directly tied to the energy sector expected further declines in their sales volumes, and companies that sell to energy-related customers suffer along with them as they adjust to an environment of weak demand.

On the upside, nearly all firms expect the U.S. economy to expand over the next year, and close to half expect this to help with their sales. Exporters not connected to the commodity sector foresee a more significant growth in sales than other firms, and the depreciation of the Canadian dollar has boosted the sales of domestically-oriented firms as a result of an increase in tourism-related activities. The pitfall of the low Canadian dollar is that the majority of firms now have to deal with higher costs for imported goods.